LONDON, May 8 (Reuters) - Britain’s No. 4 grocer Morrisons posted a worsening fall in quarterly underlying sales, hurt by its move to cut prices to combat a loss of market share to discounters and by its relative lack of exposure to fast growing online and convenience markets.
The over 500-store group, which trails market leader Tesco , Wal-Mart’s Asda and J Sainsbury by annual revenue, said on Thursday sales at stores open over a year, excluding fuel, fell 7.1 percent in the 13 weeks to May 4, its fiscal first quarter.
That compared to analysts’ average forecast for a decline of 5.9 percent, a fall of 5.6 percent in the key Christmas period and a 2.8 percent decline in the full 2013-14 financial year.
In March, Morrisons said profits would more than halve this year as it set out a plan to try and restore its low-price image with shoppers and boost sales volumes by spending 1 billion pounds cutting prices over the next three years. A move that sparked fears of an industry price war.
Last week the firm unveiled a second round of price cuts. It warned like-for-like sales were unlikely to improve any time soon as lower prices reduce actual sales going through the till.
Reporting by James Davey; editing by Brenda Goh